Money & Banking

SBI cuts deposit interest rates, MCLR by 10-15 bps

Our Bureau Mumbai | Updated on March 11, 2020

State Bank of India (SBI) has cut interest rates on retail domestic term deposits (below ₹2 crore) of one year and above tenor by 10 basis points (bps). It has also cut interest rates on domestic bulk term deposits (₹2 crore and above) of 180 days and above tenor by 15 bps with effect from March 10, 2020.

India’s largest bank has also cut its marginal cost of fund-based lending rate (MCLR) across tenors by 10-15 bps with effect from February 10. This is the tenth consecutive MCLR cut by the bank in the current fiscal. One bp equals one-hundredth of a percentage point.

Post-revision, the highest interest rate that SBI is now paying retail domestic term deposits is 5.9 per cent (6 per cent earlier) on the four maturity buckets between one year and up to 10 years.

Further, the highest interest rate that it is now paying domestic bulk term deposits is 4.6 per cent (4.75 per cent earlier) on the six maturity buckets between 180 days and up to 10 years.

SBI had only last month slashed term deposits rates by 10-50 bps in the retail domestic term deposits segment and 25-50 bps in the domestic bulk term deposits segment.

One-year MCLR

Post-revision, the benchmark one-year MCLR is at 7.75 per cent, against 7.85 per cent earlier. All rupee loans sanctioned and credit limits renewed with effect from April 1, 2016 are priced with reference to MCLR, which is the internal benchmark for such purposes.

The deposit rate cuts come in the backdrop of ample liquidity in the banking system and muted appetite for credit. Moreover, over the past month, the RBI has provided banks with long-term funds (of one year and three years tenor) aggregating about ₹1-lakh crore via the long-term repo operation (LTRO) at the policy repo rate of 5.15 per cent. Banks find raising funds via this route cheaper.

Published on March 11, 2020

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like